This is part 8 of a 10 part series I call Financial Freedom. The previous post, Count the Cost, can be found here: https://thingsmyparentsnevertaughtme.family.blog/2019/12/10/count-the-cost/
My wife and I try to live within our means. In general we have stuck to this commitment. However, for many years large purchases seemed impossible. We did incur a large amount of debt in our cars and home. We were not alone. According to Money.com in 2018 the average debt for a 51 year old like me in the U.S.A. was $134000. It seems like the banks have a great deal of control over our finances. Proverbs 22:7 “The rich rule over the poor and the borrower becomes the lender’s slave.” The average credit card debt in March 2019 according to the Federal Reserve was $5700! This means a massive amount of money is being transferred from your bank account to someone else! This did not sit right with me. My goal was to do something about this.
I look at it like the reverse of compound interest. When you buy something with credit then you end up paying much more for it. Let’s say you have $5000 of credit card debt and assume you charge nothing else to that card. You make payments of $100 a month at 18% interest. When you have paid off that credit card you will have added an extra $4311.25 in interest over 94 months. Let that sink in. A purchase of $5000 cost you almost double. Compare that to saving the $100 over 50 months and paying cash. A little patience and self control will make you $4311.25 richer. This same concept can be applied to larger items like cars and houses. This sounds impossible, right? However, the Bible calls us to it. Romans 13:8 “Owe nothing to anyone…” This idea is repeated throughout the Bible. If God said to do it then shouldn’t we give it a try?
Most people think it impossible but can you really afford otherwise? Here is what can be done. Lower expectations. Do I really need that sports car and a massive house? The bank wants to maximize it’s gains and will encourage you to buy as much as you are able. Paying cash will make you consider cheaper alternatives as well as paying less for that item over the long term. Before considering large purchases get other debt paid off. Pay down credit card and student loan as much as possible. It is a better investment to get out of debt first. Apply windfalls and raises directly to this debt. Then save! Start paying for cars and houses cash. If you already owe start double or triple paying as you can. Keep reminding yourself that debt equals slavery. Give it a try. God will not disappoint.
1. Make a plan to become debt free. If you are out of debt stay that way. If you are in debt, figure out how to get out of it.
2. Pray that God shows you how to stay out of debt. You may need forgiveness for acting outside of God’s will.
3. Be thankful for God’s direction and pray to honor God in this commandment.
We are currently working to become debt free. We now pay for cars cash and make double payments on our house. How cool is it to never have a car payment! It’s an amazing thing. I am so thankful for the freedom God gives my wife and I in that. I can’t wait to have our house payments disappear! It’s still a long way off but could you imagine what your life would be like to no longer have that massive debt? I can imagine how great it will feel to have no house payment and a peace of mind knowing we always have a home. No more stressful days wondering if we will make rent even when facing job loss! Doing the things God calls for is super cool!
I pray that God will help you be resolved in getting out of debt and staying that way so you may know a peace and fruitfulness in your finances as we are commanded to do in His word.